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‘Vigilantes’ patrol eBay

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SAN FRANCISCO — Five months ago, Klaus Priebe, a soft-spoken building contractor who said he was sick and tired of fraud on eBay, decided it was time to catch the cheaters at their game.

In one recent auction, he bid as much as $2.5 million on a telescope worth no more than $2,000. He knew he would not have to pay for the telescope because he was sure that it did not exist.

The listing was a fake, he decided, because the seller offered free shipping and was registered in Andorra, a small country in the Pyrenees, that is often listed by swindlers. Priebe said his wild bid was an attempt to protect innocent bidders from falling into the trap he had spotted.

Priebe, 42, of Pueblo, Colo., is an eBay vigilante, one of a number of eBay members who are stepping in to fight online auction fraud — a problem they say is getting worse by the week — because they believe that the company does not do enough policing of its own.

But in eBay's view, Priebe and his vigilante brethren are pariahs. Rather than embrace these virtual posses, eBay discourages them, occasionally going so far as to suspend the vigilantes' accounts.

"We love it that people want to help, but there's a right way to do it and a way that isn't constructive or in the interest of a good community marketplace," said Rob Chesnut, eBay's vice president for rules, trust and safety, who added that eBay is doing everything it can to make it safe to buy and sell on its Web site.

Ebay, based in San Jose, Calif., has 800 people deployed around the world to fight fraud among its 93 million registered users, he said, and does not need amateur help.

Critics, however, say the company is not only slow to stop fraud, but is loath to reveal how much of it goes on.

"Ebay's denial of the extent of the problem is out of control," said Mark Seiden, a computer security consultant in Manhattan who stumbled upon a fake deal for a high-end espresso maker on eBay several months ago and has since uncovered hundreds of fraudulent listings. "They probably think their brand will be stronger if they hide the fraud."

Last year, some $200 million lost to online fraud was reported to the Federal Trade Commission. And nearly half the 166,000 complaints the agency received last year were about online auctions, a 130 percent increase from 2001. While the FTC does not break out figures by companies, the vast majority of online auctions are conducted on eBay.

"It's gone nuts just since November of last year," said Greg Schiller, a computer and network technician in Aztec, N.M., who says he reports hundreds of fraudulent listings every day to eBay.

Ebay estimates that of the 20 million or so items that are for sale on its Web site at any given time, only about 2,000 items, or one-hundredth of 1 percent, are fraudulent. But that figure reflects only those cases that are settled through the eBay buyer protection claim process.